Housing Investment Comparison.pdf

The analysis unifies the type of data, measurement of variables, estimation periods, and type of demand function between the two countries.

Key Findings

1. The share of imputed rents is higher in Japan than in the United States, except for some years.
2. The income elasticity of imputed rents is higher and the absolute value of price elasticity of imputed rents is lower in Japan than in the United States, due to differences in preference between the two countries.
3. The savings rate in Japan is higher than in the United States, and the difference in savings rates between the two countries has been increasing over time.

Analysis of Factors Affecting the Difference in Imputed Rent Shares

1. Differences in household attributes, such as housing ownership rates, may affect the imputed rent share.
2. Differences in preference between Japan and the United States may also affect the imputed rent share.
3. Other factors, such as the availability of housing loans, may also play a role.

Data and Methodology

The analysis uses data from the System of National Accounts (SNA) and other sources. The Klein-Rubin type of utility function is used to estimate the demand function for imputed rents and other consumption.

Conclusion

The analysis suggests that differences in preference between Japan and the United States are an important factor in explaining the difference in imputed rent shares between the two countries. Further analysis is needed to fully understand the factors affecting the difference in imputed rent shares and to provide policy implications for housing investment and savings rates in Japan and the United States.